IT modernisation can boost revenue and cut costs

However, it's not always easy to justify ROI on IT modernisation.

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IT modernisation is essential to addressing the needs of modern digital businesses, according to a new report by Avanade. The report is based on a poll of 800 IT decision makers in organisations scattered all over the world.

On average, IT decision makers believe that by modernising IT, they could boost their company’s revenue by as much as 14 per cent. That’s almost $1 billion a year, Avanade says.

But it’s not just about boosting revenue – it’s also about cutting costs. Costs could be cut by more than 13 per cent. Most ITDMs (80 per cent) believe that by ignoring the latest trends in IT modernisation, companies could negatively affect their long-term growth.

The report goes on to say that almost two thirds (65 per cent) of ITDMs see today’s conventional systems and approaches as unfit for purpose. A predictable approach and an explanatory approach are the two approaches considered by ITDMs as the best ones. Eighty-eight per cent believe modernised IT systems are critical to both achieving these two distinct approaches, and to addressing emerging digital business requirements.

And finally, almost nine in ten (89 per cent) believe modern software engineering approaches and process automation technologies are key to addressing emerging digital business requirements.

However, not everyone is doing it. Apparently, the majority believes ROI benefits must be included alongside IT benefits, and executives usually don’t fully appreciate the ROI of modernised IT. That is, at least, what ITDMs believe.

Businesses are slowly moving towards a more modernised IT infrastructure, and the cloud is at the very heart of it. In the next three years, businesses will move from on-premises to cloud solutions, creating a hybrid IT world.

“To support this hybrid world, almost nine in ten (87 per cent) respondents agree that their organization is planning to implement vendor-provided cloud stacks (such as Microsoft Azure Stack) to integrate their on-premises data centre with the public cloud,” it says in the report.